Derickson v. Chicago South Branch Dock Co.

McAllister, J. The remedies open to a vendor in case of default in the payments by the vendee, are comprehensively stated by Hr. Justice Nelson in the case of Hansbrough v. Peck, 5 Wallace, 506: “ He may sue on the contract and recover judgment for the purchase money, and take out execution against the property of the defendant, and, among other property, the land sold; or he may bring ejectment and recover back the possession; but in that case the purchaser, by going into a court of equity within a reasonable time and offering payment of the purchase money together with costs, is entitled to a performance of the contract; or the vendor may go in the first instance into a court of equity, as in the present case, and call on the purchaser to come forward and pay the money due, or be forever after foreclosed from setting up any claim against the estate. In these contracts for the sale of real estate, the vendor holds the legal title as security for the payment of the purchase money, and in case of a persistent default his better remedy, and under some circumstances his only safe remedy, is to institute proceedings in the proper court to foreclose the equity of the purchaser where partial payments or valuable improvements have been made. The court will usually give him (the vendee) a day if he desire it to raise the money, longer or shorter, depending on the particular circumstances of the case, and to perform his part of the agreement.” The decree in such a case as that just mentioned would be what the English courts call a decree for the cancellation of the contract. Lysaght v. Edwards, L. R. 2 Ch. Div. 510. Without stopping to analyze the bill in this present case, it is manifest that the decree is of a wholly different character from one for the cancellation of .the contract or strict foreclosure. Instead of being one for the cancellation of the contract, the decree entered went upon the theory of enforcing a lien or charge in favor of the vendor for the purchase money, upon an equitable estate of the vendee or his heirs, by subjecting the same to judicial sale. That an equitable estate in the vendee and lien or charge thereon in favor of the vendor, resulted from entering into the contract in question, is a proposition not open to controversy. Vail v. Drexel, 9 Bradwell, 439, and authorities cited. 1 Pom. Eq. Jur. § 368; 3 Id. §§ 1261, 1262. But by the express provisions of that contract, the vendor was vested with the right and power, upon default on the part of the vendee in any payment of interest or principal, to declare the contract void and ended, and with it to terminate the vendee’s equitable estate and change the relations of the latter from those of purchaser and equitable owner to those of a mere tenant at will of the vendor. Default having been made in the payment of interest, the vendor, in the most unequivocal manner, exercised, before bringing this suit, said power, thus putting an end to the equitable estate of Diehard P. Derickson, created by said contract, but nevertheless for the purpose of gaining a deficiency decree against the property of the heirs of the deceased vendee, takes a decree for the sale of such equitable estate, as if it were still subsisting. Is such a decree the logical outcome of the facts alleged and proven? We think not. In a note to § 1261, Vol. 3, Pom. Eq. Jur., that learned author treating of this subject says : “ Another mode seems to be recognized, at least in some of the States, by which the vendee’s equitable estate under the contract is sold in pursuance of a judicial decree. Such a sale would operate as an assignment of the vendee’s rights under the contract, and would not be a cancellation of the contract itself.” The effect thus ascribed to such a sale must necessarily follow, and that shows how utterly inconsistent the decree in this case is, with the irrevocable position which the vendor has taken of terminating the vendee’s equitable estate under the power given by the contract and exercised as above stated. It is a rule of law based upon sound reason, that a party can not occupy inconsistent positions ; and where one has an election between several inconsistent courses of action he will be confined to that which he first adopts. Any decisive act of the party done with knowledge of his rights and of the facts, determines his election and works an estoppel. Bigelow on Estoppel, 578. The vendor with such knowledge elected to terminate the vendee’s equitaFe estate, and by that election it is bound. The only decree, therefore, to which complainant below was entitled, was one for the cancellation of the contract. But there is another difficulty. By the terms of the contract none of the principal became due until May 1, 1886, and i contains no provision which, fairly construed, gave the vendor the right to declare the principal due upon default of payment of interest. Counsel for vendor say the right is given by this provision after the words authorizing vendor to declare the contract void for such default. “ The covenants and liability of the said party of the second part shall continue and rein.iLn obligatory upon the party of the second part and may be enforced, and the said consideration money and every part thereof, with the annual interest as above specified, be collected by proper proceedings in law or equity from the party of the second part, his heirs,” etc. Mow, it has been suggested by counsel for plaintiff in error that in the duplicate which was delivered to the vendee, that clause is expressed as an alternative provision. If there was a material difference between ' the duplicate produced at the hearing by the plaintiff, and that produced by the defendants, we think the court should be governed by that in defendants’ hands. Judd v. Ensign, 6 Barb. 258. But we do not find defendants’ duplicate in the record. However, taking the above danse as it stands, and there is nothing in it which authorized the enforcement of the vendee’s covenants otherwise than according to their terms. By their terms no part of the principal is due even now. The decree below will be reversed and the cause remanded. Decree reversed. ■